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Russia Analytical Report, April 29-May 6, 2019

This Week’s Highlights:

Reports that Trump wants to negotiate a multilateral arms control agreement with Russia and China should be viewed in light of the fact that both Trump and Bolton would be happy to get rid of the New START Treaty, writes Jon Wolfsthal, director of the Nuclear Crisis Group.

Russia and China know they would be defeated if their attacks triggered a full U.S. response, writes Elbridge Colby, director of the defense program at the Center for a New American Security. Therefore, they may choose to attack in a way that keeps the U.S. response restrained enough for them to secure their gains—the most pointed form of this type of strategy is the fait accompli, he writes.

Russia’s defense spending based on purchasing power parity is close to $150-180 billion per year, making it the third largest in the world, with a higher percentage of that number devoted to R&D and procurement than Western defense budgets, writes CNA senior fellow Michael Kofman.

The Kremlin may use Venezuela—highlighted by White House adviser Fiona Hill as a major issue in the U.S.-Russia relationship due to its impact on U.S. politics—to try to force U.S. concessions in Ukraine, claims Russian political analyst Vladimir Frolov.

The visible core of Washington’s foreign policy has convinced the Kremlin that the U.S. will continue to seek regime change in Russia and never recognize that Putin’s regime has legitimate interests, writes CNA senior fellow Michael Kofman.

The international gas market, where Russia continues to strengthen its grip on an increasingly competitive market, shows the limitations of U.S. sanctions on Russia, argues Nick Butler of the Financial Times.

I. U.S. and Russian priorities for the bilateral agenda

Nuclear security:

“Our nation was fortunate to have Richard Lugar, who died Sunday [April 28] at 87, as a public servant. I was fortunate that he was my trusted friend.”

“Together, we overcame the skepticism and got leaders in both parties to see that U.S. security depended on cooperation with Moscow to ensure that the massive Soviet arsenal was secure and safely reduced.”

“The "Nunn-Lugar" program deactivated more than 7,600 nuclear warheads and destroyed more than 2,600 nuclear missiles and their launchers. It also eliminated more than 4,100 metric tons of chemical weapons and secured dozens of Soviet-era weapons facilities, as well as weapons-usable nuclear materials.”

“Three nations—Ukraine, Belarus and Kazakhstan—gave up their nuclear arsenals, voluntarily removing their fingers from the nuclear trigger. None of this would have happened without Dick Lugar.”

“The only way to successfully address critical issues in our country—reducing both security and climate threats, closing the income gap, expanding access to health care while reducing runaway costs, coming to grips with the dark side of new technologies—is by building political coalitions across party lines and treating our colleagues with dignity, civility and respect. This was the ‘Lugar Way.’ If we are to bind our nation more closely at home and make our nation more secure abroad, we must learn from his example.”

North Korea’s nuclear and missile programs:

“The most interesting question surrounding the [Putin-Kim] summit will not be answered until later. Did Moscow make any private promises to support the North, most importantly to help ease the impact of U.S. sanctions?”

“The gains to Pyongyang from such a deal are obvious: keeping even a small windpipe open would ensure the functioning of the North Korean system. A Russian commitment also would put pressure on the Xi government be more supportive of Pyongyang against Washington.”

“For Russia the economic benefits of aiding the North are minimal. … Still, helping the North resist Washington’s demands would hamper the Trump administration’s attempt to reshape Northeast Asia to its advantage.”

“The Putin-Kim soiree isn’t likely to yield much publicly anyway, but it may have won the DPRK a bit more covert backing which could strengthen its hand against Washington. If so, that will add to the price paid by America as its relations with the Russian Federation turn into a seemingly permanent mini-Cold War.”

Iran and its nuclear program:

No significant commentary.

New Cold War:

“The era of untrammeled U.S. military superiority is over. If the United States delays implementing a new approach, it risks losing a war to China or Russia—or backing down in a crisis because it fears it would—with devastating consequences for America’s interests.”

“Despite their advances, both China and Russia still know that, for now, they would be defeated if their attacks triggered a full response by the United States. The key for them is to attack and fight in a way that Washington restrains itself enough for them to secure their gains. … The most pointed form of such a limited war strategy is the fait accompli.”

“The U.S. military must shift from one that surges to battlefields well after the enemy has moved to one that can delay, degrade and ideally deny an adversary’s attempt to establish a fait accompli from the very beginning of hostilities and then defeat its invasion.”

“The National Defense Strategy provides an effective model, one that seeks to orient U.S. and allied forces toward denying China or Russia the ability to rapidly seize territory and then harden its gains in a fait accompli. … The model calls [for] … a resilient and lethal blunt layer of U.S. and allied forces [that] should be present in or near vulnerable allies or partners to delay, degrade or deny enemy advances.”

“A clarity in priority means hard choices but does not mean ignoring other threats to America’s interests, including terrorists, North Korea and Iran. It does, however, mean right-sizing the U.S. approach to these threats.”

“More than 10 different organizations across the U.S. military work on different space capabilities. The Army, Navy and Air Force each maintain distinct satellite systems, resulting in more than 130 different types of communications terminals. This approach is too unwieldy and slow to keep pace with China and Russia. A U.S. Space Force would bring all service members working on space under one umbrella.”

“To borrow the words of the plaque left on the lunar surface by Apollo 11: ‘We came in peace for all mankind.’ China and Russia make no such claim. Until they credibly commit to such a course, we must ensure our nation's military remains the most advanced on Earth—and above it.”

NATO-Russia relations:

“There are four possible solutions to the Suwalki [the corridor between the Kaliningrad Oblast of Russia and Belarus] dilemma, all of which are absent from the ongoing discourse—probably because they are too controversial or too uncomfortable for public discussion.”

“The first option is learning to live with it. … The second option is enhanced NATO presence in the vicinity of the gap. … The third option is regime change in Belarus … The fourth and final option is to quickly take out Kaliningrad in case of conflict. … A close look at the Suwalki dilemma leads to three conclusions, all of them uncomfortable.”

“The only option that does not involve an arms race and increased tension—learning to live with mutual vulnerability—runs against the predominant mood in NATO and in the countries immediately involved in the Suwalki dilemma, Poland and the Baltic states. Yet, this is the only option (especially if coupled with confidence-building measures and negotiations to reduce concentration of forces) that holds any hope of avoiding conflict.”

Missile defense:

Nuclear arms control:

“Nuclear weapons are like a rifle hanging on the wall in a play written and staged by a person unknown. We do not know the playwright's intent..”

“Nuclear weapons could go off because of a technical failure, human error or computer error. The last alarms me the most. Computer systems are now used everywhere. And how many times have computers and electronics failed—in aviation, in industry, in various control systems?”

“Nuclear weapons might also be launched in response to a false alarm. If the flight time of the missiles is reduced, leaving less time to detect a false alarm, the probability of a mistaken retaliatory launch is bound to rise. … Nuclear weapons could fall into the hands of terrorists. And who knows what other ‘surprises’ these weapons have in store for us?”

“Those who believe nuclear weapons can save the world from war should recall the 1962 Cuban Missile Crisis. … It was not nuclear weapons that saved the world, but the sobering up of the two countries' leaders, John F. Kennedy and Nikita Khrushchev. … What's more, they reached agreement on ending nuclear tests in the atmosphere, in outer space and under water, thus slowing the qualitative weapons race as well as protecting the air from the deadly products of nuclear explosions. The opportunity to continue progress in nuclear arms control was then squandered.”

“Today, the U.S. and Russia are at a perilous crossroads. They must stop and think.”

“Damage to U.S. security interests that is likely to linger well beyond the term of Donald Trump includes major setbacks to arms control. Several characteristics of the current administration’s way of operating are contributing to this result.”

“One is the priority the president gives to embellishing his self-styled image as a dealmaker … Related to that is a penchant for disparaging or destroying accomplishments of previous administrations rather than building on them. Add to that a short attention span, a preference for grand gestures over long-term diplomatic work and an urge to throw bones to the president’s domestic political base regardless of the overseas consequences. “

“A further complication is the president’s vulnerability to the manipulation of his advisors … This is especially true of National Security Advisor John Bolton. … Discarding the INF treaty is especially pointless given that there appears to be no strategic U.S. need for weapons prohibited by the treaty that is not met just as well by other existing systems.”

“Daryl Kimball of the Arms Control Association observes, ‘If team Trump suggests China must join New START or that Russia must agree to limits on tactical nukes as a condition for its extension, that should be recognized as disingenuous proposals designed to create a pretext for killing New START.’”

“Several factors ensure that the destructive effects on arms control will endure … One is the political and diplomatic friction that makes it difficult to rebuild from scratch an arms control regime that already has been destroyed. Another is … the deployment of new weapons systems after the breakdown of an earlier agreement. A third factor is the damage to U.S. credibility from Trump’s failure to live up to U.S. commitments in agreements such as the JCPOA. … The end result is that Americans are less safe now than they otherwise would have been—and will be less safe for years to come.”

“New reports indicate that President Trump has ordered his administration to begin thinking about how to negotiate a new multilateral nuclear arms control agreement with Russia and China. There are good reasons to want to constrain the nuclear activities of these countries, but any new effort to do so should not stand in the way of doing the easy and obvious thing needed to protect American security: extend the 2010 New START Treaty.”

“However, key administration figures see two flaws in New START. For Ambassador Bolton, it is an arms control agreement. As others have pointed out, there is a long line of dead treaties in the national security adviser’s wake, and he apparently wants to add New START to the list. … The other flaw, this time in the eyes of Donald Trump, is that the treaty was negotiated under President Obama.”

“To my mind, it is clear that for the reasons stated above that President Trump and Ambassador Bolton would be more than happy to get rid of the New START Treaty … It is in this context that one should view reports that President Trump is interested in trying to negotiate new broader multilateral strategic arms control agreements with both Russia and China.”

“There is also nothing that prevents the Trump administration from extending the current agreement and at the same time beginning negotiations on new ones with Russia, China or both.”

Counter-terrorism:

“Ending direct ISIS control over a vast stretch of Syria and Iraq and their riches was a major feat, and a serious blow to the organization, but it is too early to proclaim, as Mr. Trump did in February, that the American-led coalition had wiped the Islamic State out '100 percent.'”

“The counterinsurgency campaign remains critical, but alone it will not be enough to uproot ISIS or its offshoots. As Fawaz Gerges, the author of 'ISIS: A History,' has argued, Islamist terrorism feeds on a deep sense of outrage and injustice that flourishes in the broken politics of the Arab and Islamic world, the clash of Sunni-dominated Saudi Arabia and Shiite-majority Iran, and the intervention of outside powers like the United States, Russia and Turkey.”

“A long-term strategy must include seeking an end to those rivalries, tensions and conflicts. So long as they continue to boil, Mr. al-Baghdadi, or whatever preening jihadist succeeds him, will be back.”

Conflict in Syria:

No significant commentary.

Cyber security:

No significant commentary.

Elections interference:

“We have an abnormal presidential candidate who actually won, and an FBI that definitely ran a secret investigation into his highly-unusual campaign. We can wrangle over whether to use the term 'spying' to describe sending informants to meet with a Trump campaign aide George Papadopoulos, under false pretenses and subjecting another aide, Carter Page, to wiretapping. But having the law-enforcement arm of the executive branch surveil a presidential nominee from the opposing party is still the kind of case where, in a non-Trump context, anyone suspicious of our security state would smell a rat.”

“Now that the Mueller investigation has concluded that whatever the FBI thought they saw happening was probably not, in fact, the kind of complex conspiracy suggested by Christopher Steele's infamous dossier … it's reasonable to ask some more questions about the don't-call-it-spying carried out against the Trump campaign.”

“Were any other entrapping approaches made to Trump campaign officials, and by whom? … [I]t would be helpful to know more about some of the ambiguous characters involved. For instance, was Stefan Halper, the Cambridge academic used by the FBI as a confidential informant, doing any outreach to Trumpworld before the FBI investigation formally began … ?”

“And what actually became of Joseph Mifsud, the mysterious Maltese professor whose meetings with Papadopoulos, in which Mifsud claimed to have high-level contacts in Russia, set in motion events leading to the FBI opening its case? The counter-conspiracists suspect Mifsud of being connected to Western intelligence rather than the Kremlin, but nobody can ask him because he has simply disappeared.”

“Then equally welcome would be an answer to my second major question: Was any of the Steele dossier's bad intel deliberately crafted by the Russians? … The fear of abnormality reliably produces abnormality in response.”

Energy exports from CIS:

“Anyone thinking that the regime of penalties is closing off trade and bringing Mr. Putin to his knees should consider the international gas market. … Russia continues to build the capacity to preserve and strengthen its grip on gas as the market becomes more competitive.”

“The construction of Nord Stream 2 continues and is on schedule for completion by the end of this year. … [T]he TurkStream project … should also come on stream this year. Neither has been affected by the sanctions or rhetoric from the U.S.”

“Meanwhile, Russia’s role in the international gas market beyond Europe is also growing. The Power of Siberia pipeline … should be operational by December. The first phase of the long-planned liquefied natural gas development designed to provide an export route for gas from Yamal in northern Russia came on stream last year. … A second development is in prospect—reportedly taking gas to Saudi Arabia and funded by Saudi money.”

“The skill of Mr. Putin’s approach to the energy market lies in drawing international partners into the infrastructure associated with each project. This creates an incentive for importers to stick with suppliers even when the market is volatile, meaning Russia can avoid fierce price wars. … As Russia demonstrates, sanctions alone are likely to serve merely as an illustration of the current limits of American power.”

U.S.-Russian economic ties:

No significant commentary.

U.S.-Russian relations in general:

“The first pillar of U.S. policy is to accept and deal with the Russia that is and not try to create a Russia that isn’t and has never been; that’s been part of the problem since the Soviet collapse. The relationship will always be a mixture of cooperation and competition, and sometimes adversarial relations like we’re seeing right now.”

“It probably is the end of arms control as we know it, in terms of bilateral U.S.-Russian treaties. I wouldn’t write off the possibility of prolonging New START yet, but I think everybody understands we’re in a different world. And both Russia and the U.S. have said China needs to be part of this.”

“I still don’t think its [the Mueller report’s] publication is going to make that much of a difference, because Russia has become such a toxic subject domestically in the United States; for people who oppose President Trump, Trump and Russia are often synonymous.”

“I think Putin and the people around him really believe that Russia does have a right to a sphere of influence in the post-Soviet space, and that means that the West should respect that the European Union and NATO should not move any closer to Russia’s borders.”

II. Russia’s relations with other countries

Russia’s general foreign policy and relations with “far abroad” countries:

“Last week, Russia and Cuba may have thwarted a U.S. backed plot to engineer a peaceful transfer of power from Nicolas Maduro to a transitional government led by interim president Juan Guaido and Venezuela’s top officials, including Defense Minister Vladimir Padrino and Supreme Court Chief Justice Maikel Moreno.”

“On May 3, U.S. President Donald Trump called Russia’s President Vladimir Putin to flag American concerns over Russia’s ‘disruptive role’ in Venezuela and stress his country’s determination to ensure Venezuela’s return to democratic rule. But, as common in his personal interactions with Putin, Trump quickly lost the initiative … Putin expressed Russia’s displeasure with U.S interference in Venezuela while convincing Trump that he ‘was not looking at all to get involved in Venezuela.’”

“White House national security advisor John Bolton made it clear on May 1: ‘This is our hemisphere—it’s not where the Russians ought to be interfering.’ Three weeks ago, the same point, in even more forceful terms, was privately made by Fiona Hill, NSC senior director for Europe, Russia and Eurasia, during her visit to Moscow. The Kremlin was struck by Hill’s prioritization of Venezuela as the most important issue in the relationship due to its direct impact on U.S. politics and the 2020 presidential race in Florida. Moscow concluded then it found an issue it could use to force the U.S. to grant concession elsewhere, most notably in Ukraine.”

“Bolton’s invocation of the Monroe Doctrine and his ‘spheres of influence framing’ makes Moscow believe that, if done on an equal basis, a similar right should be recognized for Russia in Ukraine and other parts of the ‘near abroad.’ … Moscow is ready to sell its stake in Maduro, but it is still unclear whether Washington is ready to offer the right price.”

“Mr. Bolton said Mr. Trump wants to see a peaceful transfer of power, and that would be the best outcome [in Venezuela]. But U.S. military assistance to the Guaido forces can't be ruled out. A victory for Cuba, backed by Russia in the Western hemisphere, would be a great strategic setback for U.S. interests and stability in the region. The U.S. needs to do whatever it can to help people power succeed in Venezuela.”

“Russia measures itself first and foremost against the United States … Russian leaders seek a revision of the post-Cold War settlement in Europe, having concluded that they have no stake in the current security architecture of Europe.”

“Buffer states are not neutral by design, but represent a zero-sum calculus, in that they are either Russia’s buffers against NATO, or conversely NATO’s buffers against Russia. … Beyond chasing security, Russia seeks to restore a privileged sphere of influence … and reintegrate the former Soviet space to the extent possible around its own leadership. However, Moscow lacks the economic means, or an attractive model of development for other states, still witnessing a steady fragmentation of influence over its ‘near abroad.’”

“Russian long-term thinking is driven by a vision of Moscow at the center of its own sphere of influence, but in practice Russian policy is defined by loss aversion … Russian strategic culture has not shed itself of the perception that the country is a providential great power. Moscow views this status as de facto hereditary.”

“Moscow wants to sit on all the institutions governing the current international order, and be engaged in contact groups or forums of discussion for various international issues, that is to advance its interests and be seen as a system determining power in international affairs. … Moscow thinks that a world stabilized by spheres of influence (Yalta 1945), and arbitration among a concert of powers (1815 Concert of Europe), is the more stable system and one where it has the greatest chance of pursuing its own interests.”

“The U.S. may see Moscow’s agenda as fundamentally retrograde, but the visible ideological core at the center of Washington’s foreign policy consensus has convinced Russia’s leadership that the United States will always seek regime change in Russia, and will never recognize Vladimir Putin’s authoritarian regime as having legitimate interests.”

China:

“Many Western observers think China's rise to primacy in Central Asia, where Russia has traditionally dominated, is inevitable. … But in Bishkek, things look different. While China clearly plays an important role in the economy, Kyrgyz and foreign observers alike agree that Russian influence remains paramount—and many Kyrgyz want it to stay that way.”

“[W]hile Beijing provides capital, Moscow offers jobs. … More than 10 percent of Kyrgyzstan's population works abroad, the overwhelming majority in Russia. … Russia also has deep links with Kyrgyz security and military services. … The Kyrgyz press is largely dominated by pro-Russian outlets … An airbase at Kant trained such luminaries as former Egyptian President Hosni Mubarak and the late Syrian President Hafez al-Assad in Soviet days; today it is critical to Russian air defense across Central Asia.”

“Chinese investment in Kyrgyzstan has been controversial. A corruption case involving eight allies of former President Almazbek Atambayev in connection with a large Chinese loan is attracting widespread publicity. … Angry villagers locked the Chinese managers of a gold-mining company in a shipping container last September. … A bid by Huawei to provide closed-circuit TV surveillance in Kyrgyz cities was rejected. … China's proposed Belt and Road investments have also inflamed suspicions. … Worse, China's repression of Uighurs and other Muslim minorities has angered and alarmed Kyrgyzstan, where around 90 percent of the population is Muslim.

“The more secure Russia's position in Central Asia, the less likely it is that fear of China will drive Moscow to rebuild its ties with the West. If Chinese economic investments along the Silk Road leave Russian political primacy intact, Beijing and Moscow's anti-U.S. partnership could prove to be more durable than the Sino-Soviet alliance of the 1950s.”

“On April 21, Volodymyr Zelensky, a Ukrainian actor, comedian and performer, decisively defeated incumbent President Petro Poroshenko in the second round of Ukraine's presidential election.”

“The pattern of support for Zelensky is distinctly different from the East-West divide that has characterized Ukrainian politics over the past 20 years. … Zelensky broke the East-West stranglehold on Ukrainian politics.”

“In part, Zelensky's rhetoric resonated with voters across Ukraine. However, just as important was a shift in popular attitudes against the divisive rhetoric of previous campaigns. Zelensky ran as neither a pro-Russian nor an explicitly nationalist candidate.”

“The shift away from an East-West divide in Ukrainian politics is yet more evidence that demographics are not destiny. Research shows that both the actions of politicians and spontaneous events can shift national political alliances over time.”

“‘I would never invent this story,’ says Andrey Kurkov [an author of absurdist stories]. ‘I wouldn’t believe it is possible.’ We were talking about Ukraine’s recent presidential election which—even by the standards of the country’s effervescent political culture—was a showstopper.”

“Mr. Zelensky’s victory prompted a range of reactions. To some, his election is in keeping with the spirit of our times which has seen personalities from the small screen or the stage … achieve political stature.”

“Others see Mr Zelensky tapping into a deeper cultural tradition, from Pushkin’s Boris Godunov to Shakespeare’s King Lear, of the wise fool, the jester licensed to speak truth to power.”

“Harsher judges cite his election as more evidence of Ukraine’s essentially flawed status, a state that at times still seems to be proving its viability and where the years since independence have been a mess of political and economic chaos, corruption and war.”

“Even worse, Mr. Zelensky may be a puppet, the play thing of oligarchs and other sinister forces who backed his campaign.”

“According to a report published today [April 28], the ranks of Russian political prisoners have grown over the past four years from 50 to more than 250.”

“The report … documents in extraordinary detail how President Vladimir Putin has turned Russia's legal system into a tool of repression, using it to suppress dissent, undermine political opposition and detain anyone the Kremlin views as a potential threat.”

“They must face meaningful consequences for their actions. An important first step would be for other countries to impose targeted financial sanctions and travel bans against those officials identified in the report under global Magnitsky laws.”

“Many of the men and women caught in the Kremlin's brutal grasp sacrificed everything to stand up to its tyranny. It's only decent that those of us safe in the U.S. and elsewhere do everything we can to stand with them.”

Defense and aerospace:

“The former [Soviet] empire prided itself on not using imported planes as a matter of national security. The Soviet aircraft industry employed some 2 million people at the end of the 1980s, and about 150 civilian airplanes a year were produced. But in the mid-1990s, the industry died a painful death as impoverished Russians flew less and the Boeing-Airbus duopoly outcompeted the Soviet factories and design firms.”

“The Sukhoi project [Sukhoi Superjet], proposed by a company without experience making civilian planes but with a history of successful warplane exports, was chosen in 2002 … based on designs from the Tupolev organization, and became pretty much the only government-backed project in the industry by 2006."

“As foreign interest largely dried up, the government pushed the SSJs on Russian airlines. … Neither the airlines nor Russian regulators publish statistics on how the planes are used, but available sources show that airlines are having trouble keeping the SSJs in the air.”

“According to leaked data for 2018, the average SSJ 100 used by a Russian airline flies for about 109 hours a month, roughly a third as much as a Boeing or an Airbus and slightly more than half as much as Brazilian-made Embraer-170s with about as many seats. … The SSJ should be grounded pending a thorough investigation.”

“As for the post-imperial ambition of reviving Soviet aircraft manufacturing, there’s no need to rush it even in the face of competition with China … Russia’s engineering brainpower and strong legacy in the industry should make it possible to produce good commercial planes someday.”

“Ask yourself: Do we really know how much our adversaries spend on their military, and what they are getting for their money? Russia, for example, presents a glaring problem … Most comparisons are done in current U.S. dollars based on prevailing exchange rates, making Russia’s economy seem the size of South Korea’s. This approach is useless for comparing defense spending, or the country’s purchasing power.”

“[T]he Stockholm International Peace and Research Institute [recently announced] that Russian military spending has fallen to the sixth highest in the world in 2018, at $61.4 billion. Rest assured, or perhaps discomforted: Russian defense spending is several times higher than $61.4 billion, and the Russian defense budget remains the third largest in the world.”

“Russia’s effective military expenditure, based on purchasing power parity … is more in the range of $150-180 billion per year, with a much higher percentage dedicated to procurement, research and development than Western defense budgets.”

“There is no value in conceptualizing Russian defense spending in U.S. dollars based on the prevailing exchange rate … Yet, this is how SIPRI arrives at its $61.4 billion figure, which places Russia safely behind France, even though Moscow fields a military that’s almost 900,000 strong, with a conventional and nuclear arsenal capable of taking on the United States.”

“Depending on what you count, total military expenditure can add to roughly 4 trillion rubles in 2018 or about 4 percent of GDP. … There is well over 1 trillion rubles of military expenditure in Russia outside of the regular defense budget.”

“Moscow is not exhausting itself with defense spending … Russia is not the Soviet Union, spending itself into oblivion as the economy collapses, and we are not living in the 1980s. The truth is that for the foreseeable future, nothing has to give. It can go on, and it will.”